By Michael Sidwell

“The cases represent only the first wave of investigations, and the total fraud could ultimately reach into the tens of billions of dollars,” said Neil Barofsky, the special inspector general overseeing the Troubled Asset Relief Program, according to the article.

Barofsky’s office has released a 250-page report “detailing a long list of concerns about government efforts to prop up hundreds of banks, Wall Street firms and auto companies,” writes CNN.

In a series of recommendations, the report calls on the Treasury Department for greater transparency and greater fraud protections.

"Our recommendations are forward looking and there are no vulnerabilities that can't be addressed," Barofsky said. "The balance of what we're trying to do is to inform, bring transparency and make appropriate recommendations" (CNN).

According to Barofsky, the Treasury “should dispense with rating agency determinations” on mortgage-backed securities, which lay at the root of the financial crisis, and should instead screen each security to assess its value, reports the FT.

In addition, Barofsky also urges federal officials to create safeguards that prevent conflicts of interest arising among banks and investors participating in the new Public- Private Investment Program to stop "collusion between participants, and vulnerabilities to money laundering” (CNN).

The report illustrates the complexity of the US bailout programme. “What started out in October as a [US] $750-billion effort only to buy toxic securities has morphed into 12 separate programs that cover up to [US] $3 trillion in direct spending, loans and loan guarantees -- an amount roughly equal to the annual federal budget,” reports the LA Times.

The inspector general's office is now conducting six audits, “including one on whether recent bonus payments to American International Group employees complied with government aid conditions and whether Treasury was aware of the full range of compensation plans at the company,” notes Reuters.

Join TI-USA's campaign Show us the money! to promote transparency and accountability in the US stimulus effort.

By Michael Sidwell

As part of efforts agreed at the London Group of Twenty summit in April the Organisation for Economic Co-operation and Development’s (OECD) published a blacklist which designated Costa Rica, Malaysia, the Philippines and Uruguay as non-cooperative, reports the Financial Times. Leaders at the summit said that “they would crack down on tax havens, including sanctions against non-cooperative jurisdictions, by using information from the OECD,” writes Reuters.

All four countries were moved to a “grey list” after agreeing to accept international tax reporting standards. In a press release the OECD said, “They have now officially informed the OECD that they commit to co-operate in the fight against tax abuse, that this year they will propose legislation to remove the impediments to the implementation of the standard and will incorporate the standard in their existing laws and treaties.”

According to Reuters, the “grey list” contains countries that have “agreed to improve transparency standards but have not yet signed the necessary international accords.” The list also includes Luxembourg, Switzerland, Austria, Belgium, Singapore and Chile as well as the Cayman Islands, Liechtenstein and Monaco.

European Union Commissioner for Taxation and Custom Union Laszlo Kovacs said, “Commitments are the first step; we're more interested in the implementation. We need a level playing field and are looking forward to quick implementation of the standard” (Wall Street Journal).

According to research from Oxfam, “Developing countries miss out on up to [US] $124 billion every year in lost income from offshore assets held in tax havens.”

To read Transparency International’s recommendations to the G20 on financial offshore centres and what needs to be done to enshrine transparency and accountability in all economic rescue and reform measures, please click here

By Michael Sidwell

“The former mayor of Venezuela's second largest city had been in hiding since the charges were filed in March,” reports BBC.

“Venezuelan officials say Rosales illegally enriched himself as governor of Zulia state from 2002 to 2004,” writes CNN. According to The Washington Post, “Prosecutors called for Rosales's arrest in March on charges of illicit enrichment, and lawmakers in the National Assembly have opened a probe to determine the source of [US]$60,000 that Rosales made while governor of the oil-rich state of Zulia. Rosales was elected mayor of Maracaibo, the capital of Zulia, in November but stepped down last month in the wake of the government's investigation.”

Rosales has rejected the graft charges and says “he is being politically persecuted by Venezuela's leftist President Hugo Chavez”, according to AFP.

Bloomberg reports that: “Opponents of the government have also been targeted by the legislature and by government appointees over the past year. Ahead of the November regional elections, the former mayor of Chacao, Lopez, was banned from running again for any public office by the government’s comptroller general, an anti- corruption watchdog.”

“Rosales ran afoul of Chavez after he was linked to the 2002 attempted coup against the leftist leader. Chavez accused Rosales in October of plotting to assassinate him, and threatened to have him jailed,” claims AFP.

Mario Isea, a lawmaker in the National Assembly and a member of Chavez’s socialist party, said that “Rosales isn’t being persecuted,” reports Bloomberg.

"This citizen is being investigated by Venezuelan justice for crimes outlined in the anti-corruption law," said Venezuela's justice minister Tareck El Aissami (Washington Post).

On 24 April Interpol, an international intelligence agency, issued an arrest warrant for Rosales.

However, Rosales’ Peruvian attorney, Javier Valle Riestra, told AFP that Interpol cannot arrest his client because it “is forbidden from intervening in cases of politics, race or religion.”

In response to news that Rosales was granted political asylum in Peru, Venezuela’s foreign ministry said that it was “recalling its ambassador in Lima and evaluating its diplomatic relations with Peru,” according to Associated Press.

Rosales was the main opposition candidate in the 2006 presidential election, which he lost to Chavez.

Photo - Alejandro Alarcon